653AH. Deferral of residential zoned land tax in certain circumstances

(1) This section applies where—

(a) a planning permission has been granted in respect of development on a relevant site,

(b) all or part of the development consists of residential development (and such portion of the development as consists of residential development on the relevant site shall be referred to in this section as ‘relevant residential development’), and

(c) a commencement notice, in respect of the development, has been lodged with the local authority in whose functional area the relevant site is situated.

(2) Where more than one commencement notice is lodged with a local authority in respect of a development, the reference in subsection (1)(c) to a commencement notice shall be construed as a reference to the first commencement notice lodged with the local authority in whose functional area the relevant site is situated that is in respect of the commencement of substantial activity in relation to the development.

(3) Subject to ^[4]>subsections (5) and (7)^<[4][4]>subsections (4A), (5), (5A) and (7)^<[4], where this section applies, so much of ^[5]>any residential zoned land tax arising in respect of^<[5][5]>any residential zoned land tax, less any such tax paid pursuant to subsection (5A), arising in respect of^<[5] a liability date in relation to a relevant site after the submission of the commencement notice referred to in subsection (1)(c) which relates to relevant residential development shall, notwithstanding section 653Q(2), not be due and payable until the earliest to occur of—

(a) the date on which the works (within the meaning of the Act of 2000) on the relevant site permanently cease where, on that date, certificates of compliance on completion in respect of all of the relevant residential development have not been lodged with the local authority concerned,

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(b) the date on which there is a change in the ownership of the relevant site, where such a change occurs prior to certificates of compliance on completion having been lodged with the local authority concerned in respect of all of the relevant residential development, and

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(b) the date on which there is a change in the ownership of all or part of the relevant site—

(i) in the case of a change of ownership of all of the relevant site, where such a change occurs prior to certificates of compliance on completion having been lodged with the local authority concerned in respect of all of the relevant residential development, or

(ii) in the case of a change of ownership of part of the relevant site, where such a change occurs prior to certificates of compliance on completion having been lodged with the local authority concerned in respect of the part of the relevant residential development on that part of the relevant site,

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(c) the date of expiry of the planning permission period for the planning permission, where, on that date, certificates of compliance on completion in respect of all of the relevant residential development to which the planning permission relates have not been lodged with the local authority concerned.

(4) Residential zoned land tax which, by virtue of subsection (3), is not due and payable until the earliest to occur of the events referred to in paragraphs (a), (b) and (c) of that subsection, shall, in relation to the relevant site, be referred to in this section as ‘deferred residential zoned land tax’.

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(4A) (a) In this subsection—

“group” has the same meaning as it has in section 616;

“member of a group” has the same meaning as it has in section 616.

(b) This subsection applies where—

(i) a member of a group of companies (in this subsection referred to as the ‘transferor company’) transfers a relevant site or a part of a relevant site, as the case may be, in respect of which this section applies to another member of the group (in this subsection referred to as the ‘transferee company’), and

(ii) the transferor company and the transferee company are within the charge to corporation tax.

(c) Where this subsection applies, for the purpose of this section—

(i) the relevant site or part of the relevant site, as the case may be, that is transferred is deemed to have been acquired by the transferee company at the time it was acquired by the transferor company,

(ii) the transferee company shall, from the date of the transfer, be deemed to be the liable person in respect of any deferred residential zoned land tax relating to the relevant site or part of the relevant site, as the case may be, in respect of a liability date prior to the transfer referred to in paragraph (b), and

(iii) the transfer of the relevant site or part of the relevant site, as the case may be, to the transferee company shall not give rise to a change of ownership of the relevant site or part of the relevant site for the purposes of subsection (3)(b).

(d) Where deferred residential zoned land tax becomes due and payable in accordance with subsection (3), (5A) or (7)(b) in relation to the relevant site, or the part of the relevant site, as the case may be, which is transferred, the transferor company and transferee company shall be jointly and severally liable for such tax.

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(5) The amount of residential zoned land tax which—

(a) arises in respect of a liability date that falls after the lodgement of a commencement notice and up to the earliest to occur of the events referred to in paragraphs (a), (b) and (c) of subsection (3), and

(b) relates to a relevant residential development,

shall be—

(i) where the development referred to in subsection (1)(a) consists of residential development only, the amount of all residential zoned land tax arising in respect of the relevant site, or

(ii) where the development referred to in subsection (1)(a) consists of residential development and development other than residential development, the amount represented by A in the formula—

A = B × C

where—

B is, on the valuation date applicable to the liability date, the market value of that part of the relevant site which, having regard to the planning permission referred to in subsection (1), is being used for residential development (referred to in this section as the ‘qualifying part of the relevant site’) and subsection (6)(a) shall apply for the purpose of determining the market value of the qualifying part of the relevant site on the first liability date after the date on which the commencement notice referred to in subsection (1)(c) is lodged, and

C is the rate of 3 per cent.

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(5A) (a) Where—

(i) there is a change of ownership of part of a relevant site to which this section applies,

(ii) that change of ownership does not result in the entire relevant site having changed ownership, and

(iii) that change of ownership is the earliest to occur of the events referred to in paragraphs (a), (b) and (c) of subsection (3),

(referred to in this subsection as a ‘part ownership change’) the amount of any deferred residential zoned land tax in respect of that part of the relevant site so transferred which—

(I) arises in respect of a liability date that falls in the period from the date of the lodgement of the commencement notice to the date of the part ownership change, and

(II) becomes due and payable in accordance with subsection (3) on the date of the part ownership change (referred to in this subsection as the ‘part ownership change liability’),

shall be the amount represented by ‘A’ in the formula—

A = (B – C) × D/E

where—

B is the deferred residential zoned land tax in respect of the relevant site (as that relevant site was comprised prior to any change of ownership),

C is the sum of part ownership change liabilities arising in respect of the relevant site prior to the change of ownership referred to in subparagraph (i),

D is the area, in square metres, of the part of the relevant site which is transferred pursuant to the part ownership change, and

E is the total area, in square metres, of the relevant site as it was comprised immediately prior to the change of ownership referred to in subparagraph (i).

(b) Following a part ownership change, subsection (3) shall continue to apply as if the part ownership change did not occur.

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(6) Where subsection (5)(ii) applies—

(a) the market value of the qualifying part of a relevant site on the first liability date after the commencement notice referred to in subsection (1)(c) is lodged, (represented by ‘B’ in the formula contained in subsection (5)(ii)), shall be computed in the same manner as the market value of the ‘liable part of the relevant site’ (within the meaning of section 653AG) is computed under section 653AG(4), and

(b) for the purposes of section 653R—

(i) so much of the relevant site to which residential zoned land tax continues to apply shall be treated as having a valuation date falling on the same day as the first liability date after the commencement notice referred to in subsection (1)(c) is lodged and, where section 653AG(2) applies in relation to that portion of the site which is being developed for a purpose other than residential development, the market value on that valuation date shall be the market value determined in accordance with paragraph (a), and

(ii) the valuation date referred to in subparagraph (i) shall continue to apply until 1 February in the year immediately following the earliest to occur of the events referred to in paragraphs (a), (b) and (c) of subsection (3).

(7) Notwithstanding subsection (3), where, in relation to a relevant site referred to in subsection (1)—

(a) one or more certificates of compliance on completion are lodged with a local authority in respect of all of the relevant residential development in advance of the expiry of the planning permission period relating to that site, then, on the making of a claim by the liable person, the amount of the deferred residential zoned land tax shall no longer be due and payable, or

(b) on the expiry of the planning permission period, one or more certificates of compliance on completion are lodged with a local authority in respect of part only of the relevant residential development and the percentage of completion, calculated in accordance with subsection (8), is within any of the percentages specified in column (1) of the Table to this section, then, on the making of a claim by the liable person, the percentage of the deferred residential zoned land tax relating to the relevant site which is due and payable shall be the percentage, set out in column (2) of that Table, opposite the relevant percentage of completion in column (1).

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(7A) Where deferred residential zoned land tax becomes due and payable in accordance with ^[3]>subsection (7)(b)^<[3][9]>[3]>subsections (3) or (7)(b)^<[3]<[9][9]>subsection (3), (5A) or (7)(b)^<[9], the liable person shall amend each return in respect of each liability date to which this section refers and pay any tax and interest due accordingly.

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(8) For the purposes of subsection (7)(b) and column (1) of the Table to this section, the percentage of completion of relevant residential development on a relevant site at the expiry of a planning permission period shall be the amount, expressed as a percentage, represented by A in the formula—

A = (B/C) × 100

where—

B is the total gross floor space of the relevant residential development which is completed at the expiry of the planning permission period, and

C is, in accordance with the planning permission, the total gross floor space of the relevant residential development.

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(8) For the purposes of subsection (7)(b) and column (1) of the Table to this section, the percentage of completion of relevant residential development on a relevant site at the expiry of a planning permission period shall be the amount, expressed as a percentage, represented by A in the formula—

A = (B/C) × 100

where—

B is the total gross floor space of the relevant residential development on the relevant site which is completed at the expiry of the planning permission period, less the total such gross floor space, if any, of the part of the relevant residential development on a part of the relevant site in respect of which there has been a part ownership change (within the meaning of subsection (5A)), and

C is, in accordance with the planning permission, the total gross floor space of the relevant residential development on the relevant site, less the total such gross floor space, if any, of the part of the relevant residential development on a part of the relevant site in respect of which there has been a part ownership change (within the meaning of subsection (5A)).

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(8A) For the purposes of the formula in subsection (8), a reference in that subsection to a relevant site is a reference to the relevant site as it was comprised prior to the lodgement of any certificate of compliance on completion in respect of residential development on the relevant site and the consequent application of section 653O(5).

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(9) A claim referred to in subsection (7) shall be made in such form and contain such particulars as the Revenue Commissioners may prescribe.

(10) This section only applies if a return referred to in section 653T is delivered to the Revenue Commissioners in respect of each liability date to which this section refers notwithstanding the application of ^[12]>subsection (2)^<[12][12]>subsection (3)^<[12].

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